Digital Only Subscription
Read the digital SMART Edition of The Times-Tribune on your PC or mobile device, and have 24/7 access to breaking news, local sports, contests, and more at thetimes-tribune.com or on our mobile apps.

Digital Services
Have news alerts sent to your mobile device, read the Smart Edition sign up for daily newsletters, activate your all access, enter contests, take quizzes, download our mobile apps and see the latest e-circulars.

On the morning of Dec. 7, 1941, Joseph P. McDonald manned the switchboard at Fort Shafter in Hawaii when he received the alarming message that radar had detected a large number of planes approaching from the north, heading fast for Oahu.
(read more)

Motorists who use the Pango mobile app to pay at parking meters in Scranton will get reimbursed for any inadvertent overcharges since Sept. 1, the new operator of the city’s parking system said.
(read more)

Article Tools

Judge Joanne Corbett swears in Wayne Evans to his Scranton Councilman position as he rest is hand a bible held by his grandchildren Keira Evans, 9, Aela Evans, 7, Holden Evans, 4, Keller Evans, 3, and Juliet Evans, 2 in Scranton City Hall on Thursday, July 31, 2014. His father Carl Evans stands by his side. Jake Danna Stevens / Staff Photographer

JAKE DANNA STEVENS / STAFF PHOTOGRAPHER Wayne Evans is sworn in as a Scranton City Council member in City Hall on Thursday

For the first time since 1994, Scranton will again impose a commuter tax, this time to shore up the strapped city’s severely underfunded pension system.

City council on Thursday adopted a 0.75 percent earned-income tax on nonresident workers to raise an estimated $5.1 million a year. Council voted 4-1, with President Bob McGoff and councilmen Pat Rogan, Joe Wechsler and Wayne Evans in favor and Councilman Bill Gaughan opposed, to adopt an ordinance authorizing the Act 205 earned-income tax on nonresidents who work in the city.

Despite pending changes to Act 205 that would require the city to levy the same tax on residents, Mr. Rogan and Mayor Bill Courtright insisted residents would not see a wage-tax hike.

Mr. Courtright and other officials told council the tax is necessary so the pension system doesn’t collapse and sink the city with it. The alternative would be exorbitant property tax hikes on city residents, he said.

“I think one of the alternatives we would have to look at if the (commuter) tax doesn’t pass, that we’d rather not look at, is a much larger increase in the real estate tax than we’ve proposed. It could be much, much higher,” Mr. Courtright told council.

Larry Durkin, attorney for the city’s Composite Pension Board, also said the pension system is flirting with insolvency, with more money going out than coming in. If the stock market were to tank, as it did a few years ago, the pension fund’s investments likely would be wiped out, he said. The city would still be required to pay pensions, city solicitor Jason Shrive said. A collapse could put to the city under a receivership or in bankruptcy, he said.

The earned-income wage tax for pensions is allowed under state Act 205 .

Several city residents and a few nonresidents who spoke opposed the tax. Laureen Cummings of Old Forge, a home health nursing company owner, said the city needs “to look at the real problem here, and that is your unions ... I’m completely against this (tax). I’m surprised this room isn’t packed. It’s not just affecting Scranton, but now everybody’s going to be affected by your vote tonight.”

City residents Les Spindler and Dave Dobrzyn defended the tax.

Mr. Spindler said a “delay would take money out of city pockets,” and, “We need every penny we could get coming into the city.”

State Rep. Sid Michaels Kavulich, D-Taylor, said he is concerned for commuters and, “It is overwhelming that they don’t want to pay this commuter tax.” He said he is exploring whether state Act 47, the distressed municipalities law, trumps Act 205. He also questioned whether the unions’ willingness to negotiate concessions means the city has not exhausted all options before resorting to a commuter tax.

Council’s debate mirrored its prior discussions when the tax ordinance was introduced and advanced.

Mr. Gaughan said a commuter tax is premature without union concessions and in absence of the mayor’s 2015 budget proposal; and due to a pending state bill to amend Act 205 to include a commensurate hike on residents.

“City residents will face a 33 percent increase in their wage tax, which would be crippling,” Mr. Gaughan said. “I haven’t heard a good reason yet as to why the administration is in such a rush to impose this tax.”

Mr. Rogan disagreed and said adopting a commuter tax now, under current Act 205, means city residents won’t pay more.

“Just to be very clear,” Mr. Rogan said in caucus before the meeting, “adoption of this tax will not mean one cent additional tax for the residents of Scranton.”

Mr. Shrive replied, “Not as the law stands today.”

Mr. Rogan asked Mr. Courtright, “We can safely tell the residents of city of Scranton that their earned income tax is not going up, no matter what the state does, is that correct?”

Mr. Courtright replied, “That would be our position now, as the law exists. I wish I could see into the future, but I can’t. That would be our position now, as the law exists.”

The mayor and other supporters said that if Act 205 is amended, the city would have to revisit the commuter tax issue. Mr. Shrive said the options would be to amend it, repeal it or impose it on city residents. The mayor said he has no intention of raising the city’s wage tax, which already is at 2.4 percent. Another 1 percent of city wage tax goes to the school district.

Another idea if the Act 205 amendment passes — lowering the city’s wage tax by 0.75 percent and then raising it by that amount to comply with the new law — won’t work, Mr. Gaughan said. He said the city cannot lower and raise its wage tax in the same budget year.

Mr. Rogan, Mr. Wechsler and Mr. McGoff said the city cannot wait to see what the state does, and the Act 205 tax on commuters is the first step of a plan devised by financial consultant Henry Amoroso. Mr. Rogan said city leaders “have to look out for our own.”

Mr. Evans, in his first meeting after being sworn in to office earlier Thursday, said he was disappointed that the administration did not secure concessions for pension reform first, but he supports the Amoroso plan and its Act 205 commuter tax plank. He said he was taking it “on faith” that union concessions would be forthcoming, which drew chuckles from the audience.

Mr. Shrive said the tax is estimated to raise $1.2 million in fourth quarter of this year, minus costs of mailing notices to employers and the collection agency fee.

The tax won’t apply to commuters whose home municipalities already have earned-income taxes greater to or equal to Scranton’s, such as Carbondale and Wilkes-Barre.

In other business, council voted 5-0 on each of the following:

• To introduce a resolution to approve the mayor’s appointment of Patrick DeSarno as fire chief. Chief DeSarno, 53, had been serving as acting fire chief since Jan. 6, and resigned from that post July 25. His appointment as fire chief was effective Saturday. He resigned after becoming fully vested on the 25th anniversary of his hiring date in May. His pension will be frozen until after he turns 55 and after he retires from the fire department. As acting chief, Mr. DeSarno earned his union firefighter salary of $69,366, but now as chief he earns an annual salary of $50,000 under the 2014 budget enacted by the former mayor and council. However, Mr. Courtright and this year’s council are expected to raise the fire chief’s salary in the 2015 budget.

• To advance on second readings , and then adopt on third readings, a pair of ordinances to execute easements with Lackawanna Heritage Valley Authority for various properties along Nay Aug Avenue and for a section of the Lackawanna River Heritage Trail in the city.

• To adopt an ordinance adopting the 2009 edition of the International Maintenance Code regulating and governing maintenance, condemnation and demolition of buildings, and permits and fees; and repealing a 14-year-old ordinance.

• To adopt an ordinance to create a special account for health care contributions from employees of Republic Parking who are members of Teamsters Local 229, and for receipt and disbursement of those funds.

• To adopt a resolution approving the reappointment of Steven Kochis of Hickory Street to the zoning board. His prior term expired July 16 and his new term will expire July 15, 2019.

In another matter, council will recess for the month of August. Council’s next regular meeting will be Sept. 4.

We welcome user discussion on our site, under the following guidelines:

To comment you must first create a profile and sign-in with a verified DISQUS account or social network ID. Sign up here.

Comments in violation of the rules will be denied, and repeat violators will be banned. Please help police the community by flagging offensive comments for our moderators to review. By posting a comment, you agree to our full terms and conditions. Click here to read terms and conditions.